Should the federal government hand out more than $3 billion from American taxpayers to a Fortune 500 company as part of a program to help small and disadvantaged businesses compete with large corporations? Of course not, but it’s about to happen.

First, some background. The Federal Communications Commission is in charge of auctioning a public asset—the nation’s wireless spectrum—for private-sector use. Last week the FCC finished auctioning spectrum for nearly $45 billion. This spectrum will now be used to deliver high-speed...